[HN Gopher] Why Discover is no American Express
___________________________________________________________________
Why Discover is no American Express
Author : kazanins
Score : 68 points
Date : 2024-07-21 14:28 UTC (3 days ago)
(HTM) web link (www.popularfintech.com)
(TXT) w3m dump (www.popularfintech.com)
| bediger4000 wrote:
| I worked on credit card processing at a Visa Level 1 merchant,
| 2001-2003. Amex was far more difficult to handle than any other
| type of card. 13 digits in a card number, 4-digit CVV, other
| weird problems that other card types didn't have. Small
| businesses dislike taking Amex because the per-transaction
| processing fees are bigger.
|
| As a consumer who got in trouble during the 2008 depression, I
| will note that Discover is less forgiving, and quicker to sell
| your debt to debt collectors than any other bank.
|
| My take is to avoid both as a consumer, if you can.
| giancarlostoro wrote:
| My dad worked at a hotel and he noticed that anytime Amex card
| holders did a charge back, even if their signature matched
| their ID, they'd always pull the funds, and the hotel would
| lose money.
|
| We got Amex after that, since it means if we ever have a true
| theft/card skim issue, chances are high they will back us,
| instead of putting the debt on us. If that ever changes, I'll
| ditch them. The small shops might not take them, but every gas
| station does, and I rather not pump gas with my debit card.
| integricho wrote:
| why would you ever use a credit card if you have funds
| available for purchase on your debit card? especially for
| small purchases like gas, seems like an unnecessary way to
| build up debt.
|
| EDIT: I was unaware of all the below listed advantages for
| using credit cards, especially about % cash-back
| opportunities, no idea if my bank also supports something
| alike. Anyway, thanks, I have to investigate/rethink how I
| pay from now on.
|
| EDIT2: I just learned my country does not support cashbacks,
| not in any one of the banks.
| blitzar wrote:
| I do 99% of my daily spending on credit cards and have
| never once in 40 years paid interest on a credit card.
|
| Buying something with a credit card does not mean you never
| pay it back.
| rqtwteye wrote:
| I pay off my credit card every month so no debt. Can you do
| chargebacks on a debit card?
| bluGill wrote:
| You can charge back on a debit card, but the money
| doesn't get back into your account right away, and of
| course until you realize what is up your bank account is
| down that money (or even negative) and you thus don't
| have that money to spend. If your account is negative you
| are charged bank fees - I'm not sure if they will refund
| them, but at the very least until the investigation
| completes you are out that money as well.
|
| which is to say if there is fraud a debit card will
| eventually fix you, but while things work through the
| system you have no money for day to day life. With a
| credit card you don't pay that part of the bill and so
| your money is still there for day to day life.
| j-bos wrote:
| For me it's very convenient to have all purchases listed in
| the same account, also saves me time in decision making. As
| for debt, that's what budgets are for.
| mmaniac wrote:
| I only ever use my debit card for cash withdrawals, and I
| purchase exclusively on my credit card.
|
| Why wouldn't I? My direct debit clears the balance every
| month so I never pay interest, and I enjoy a couple quid of
| cashback and better consumer protections.
| pilotneko wrote:
| It shields you from getting your debit card skimmed. The
| credit card is also easier to contest if there is an issue.
| If you pay your credit card balance off every month, you
| never end up paying interest either. Finally, you can
| accrue points and rewards spending money you already
| planned to spend.
| Bluecobra wrote:
| If you are responsible and pay your statement in full each
| month, it's free money. My particular Amex card gives me 5%
| cash back on gas and groceries and has no fees. This
| translates to ~$1,200 per year.
| TMWNN wrote:
| Which Amex card? The ones I've seen cap the total
| purchase amount for rewards for gas/groceries at a low
| enough level that the rewards max out at a few hundred a
| year. (Cash Magnet's cashback is universal and unlimited,
| but the 1.5% rate is less than Wells Fargo Active Cash's
| 2%.)
| Bluecobra wrote:
| It's just called "Blue Cash", not "Blue Cash Everyday" or
| "Blue Cash Preferred". It seems like they don't offer it
| to new applicants anymore. The only downside is that you
| have to spend $6,500 before the 5% cash back kicks in for
| groceries/drug stores/gas stations, though I usually hit
| that in a couple of months anyways.
|
| edit: more info here https://www.reddit.com/r/amex/commen
| ts/12r91y4/what_happened...
| xp84 wrote:
| I had that card almost 20 years ago, until Amex abruptly
| closed both that and my "Student" Amex Blue that had very
| few benefits. Their letter referenced that "something on
| my credit report" and apparently the one forgotten
| payment I'd had recently, to Macy's for $60 (forgot I had
| used the card) was an unforgivable sin, surely portending
| a bankruptcy filing in their view, I guess.
|
| I harbored a grudge over that for about 15 years, but
| finally got back on the Amex bandwagon with a Gold card a
| few years ago. 4 points per dollar on dining and
| groceries works out really well for me.
| EForEndeavour wrote:
| Treat the credit card as a middleman between your actual
| cash (e.g., a checking account) and spending. Spend as if
| it's cash. Pay balance weekly to avoid ever paying
| interest. Enjoy far superior fraud protection, and an
| effective discount of roughly 1-10% depending on credit
| card perks.
| Dalewyn wrote:
| >Pay balance weekly to avoid ever paying interest.
|
| Perhaps counterintuitively, that is bad behaviour. If you
| pay before the billing cycle comes due, the banks will
| first insist you don't need a high credit limit and they
| will also insist you're a financial risk.
|
| The best way to pay credit cards statements is to wait
| for the cycle to close and then pay the statement balance
| in full. You should only make a payment in the middle of
| a cycle if you need more room in your card's credit limit
| for an upcoming purchase(s).
| nemomarx wrote:
| Do you need a very high limit? I pay every other week and
| my limit is already higher than my paycheck usually is,
| so I'm not sure what I'd use an even higher ones for?
| jjav wrote:
| Part of your credit score is the percentage utilization
| of your available credit. So you want higher limits that
| you'll never use in order to make that percentage smaller
| and thus your credit score higher.
|
| Silly game but might as well play it.
| arccy wrote:
| for the times when you actually want to put something on
| the card, like plane tickets and hotels
| Dalewyn wrote:
| Higher credit limits mean many good things:
|
| * The bank is confident you will pay back your debts.
|
| * Your credit utilization will be lower relatively
| speaking, which banks really like.
|
| * You can put more spend on your card if and when you
| really need to.
|
| It's always worth waiting for the billing cycle to close
| before paying the statement balance if it is practical to
| do so.
| toast0 wrote:
| Never know when you're going to need to buy a car and
| drive to Mexico. :P
| rqtwteye wrote:
| I have my cards on auto pay on due date. Works perfectly.
| EForEndeavour wrote:
| Oops. TIL I've been doing it wrong for years. Thank you
| for sharing this tip!
| commandar wrote:
| >If you pay before the billing cycle comes due, the banks
| will first insist you don't need a high credit limit and
| they will also insist you're a financial risk.
|
| Not my experience at all. I pay multiple times per credit
| cycle and have never had an issue getting CLIs. My total
| available LoC is a few of multiples of my annual income
| and the only reason I stopped asking for CLIs is because
| I got bored with it and had enough available credit that
| I basically never carry more than a 1-3% total balance
| even if I'm floating large purchases.
|
| I'd go farther and suggest that this advice is
| potentially harmful with the recent changes to FICO
| scoring where balances have a rolling average impact --
| having a balance hit your credit report because payment
| posted after your bank's reporting date will now follow
| you for considerably longer than in the past.
|
| Discover and AmEx are pretty generous with CLI requests
| IME. I went through a period where they both seemed
| intent on being my highest LoC card and would often
| unilaterally extend a CLI after a CLI from the other hit
| my credit report. BoA is also fairly generous. Citi and
| Chase seem to extend more grounded credit lines. Wells
| Fargo is hilariously stingy.
|
| The big thing with any of them is asking, though. None of
| them unilaterally offer CLIs very often IME.
|
| All IME, YMMMV.
| ourguile wrote:
| I also had my debit card skimmed. Contacted the bank the
| same day but funds were locked. So, I ended up just using
| my credit card for purchases in the long run until the
| dispute was resolved. FWIW I am hyper vigilant looking for
| card skimmers at gas stations, etc. but somehow I still was
| targeted.
| xnyan wrote:
| I get an average of 2.5% cash back on all purchases made
| with my credit card. I pay the balance in full each month
| and have never paid an interest charge. Why on earth would
| I not take the free money?
| jt2190 wrote:
| On the surface it seems like we're comparing two similar
| pieces of plastic that provide mechanisms for transferring
| cash from a purchaser to a vendor, but I think it's more
| useful to think about the contract terms that you, the
| purchaser, agree to when you transact using one or the
| other.
|
| For example, the ability to "claw back" funds transferred
| by credit card gives the purchaser much more confidence
| when dealing with an unknown vendor. Debit cards introduce
| more risk that funds can't be recovered if the purchase has
| not been fulfilled or otherwise gone bad.
| thereddaikon wrote:
| You know how you get an 800+ credit rating? Put all of your
| normal expenses on your credit card and pay it off monthly.
| You only accrue interest on a card if you have a balance on
| it that carries over. If you pay it off every month you
| don't.
|
| I almost never use my debit card. Its inherently more risky
| because it's directly connected to your checking account. A
| credit card isn't. If its compromised, it's much less
| damaging financially and easier to reverse.
| arccy wrote:
| still have to be careful about going over credit
| utilization...
| Spivak wrote:
| Yes and no, high utilization dings your score for the
| month you made the big purchase but returns to normal
| once it's paid off. If you routinely have high
| utilization CCs will just increase your limit so your
| normal spending is in the ideal range.
| JumpCrisscross wrote:
| > _You know how you get an 800+ credit rating?_
|
| You can also game it by repeatedly running up large
| balances and then paying them down to zero right before
| the next reporting cycle.
| sneed_chucker wrote:
| It's really good to have a level of indirection between
| your purchases and the account where your hard-earned money
| sits.
|
| If you have to dispute a charge it's much nicer to dispute
| it when it's on a credit card bill than when the money is
| already out of your bank account.
|
| Think of it like a bastion host for your money.
| have_faith wrote:
| I get British Airways avios points and flight companion
| vouchers with mine. I only purchase things I would have
| otherwise already brought without it, like food shopping
| and fuel etc, and pay the balance to zero at the end of
| every month. I have no interest in using it for "genuine"
| credit, like buying something you can't afford and paying
| it back in chunks later.
| giancarlostoro wrote:
| The main reason is because in the US if someone skims your
| card at a gas station and charges money to your account, it
| is next to impossible to get your money back from the bank.
| A credit card company is more likely to refund the
| transaction on the other hand.
| kube-system wrote:
| That's not true. Debit cards have fraud protection
| similar to credit cards. But the big difference is that
| you have a smaller window to report the issue, and while
| it is being resolved, you're out of the money instead of
| the bank. And it may be a bigger PITA if you need to
| close the account.
| jjav wrote:
| > That's not true. Debit cards have fraud protection
| similar to credit cards.
|
| Similar being the key word. Yes they are somewhat
| similar, but credit cards have better protection by
| regulation, so they are not the same.
|
| https://www.experian.com/blogs/ask-experian/are-credit-
| cards...
|
| The two day reporting on debit cards is particularly
| risky. I very actively review every transaction, but only
| about every two weeks at best or once a month at worst.
| With credit cards this is not an issue.
| kube-system wrote:
| That's 2 days if you physically lose your card. Otherwise
| you have 60 days after you receive your statement. If you
| know where your wallet it, and you review statements once
| per month, you're fine. I still use a credit card
| instead, though, because I'd rather the lost money be the
| bank's problem to resolve.
| pkaye wrote:
| Credit cards often have extended warranties in the US. Once
| two of our Android phones failed due to a defect a few
| months after warranty expired. I called up the credit card
| company and they returned the full amount for both phones
| with minimal fuss.
|
| The % cash back we accumulate to buy fun stuff for the
| family. Like a new laptop or video game system.
|
| Also we pay off our credit cards monthly so there is no
| debt buildup but the activity helps maintain a good credit
| score. Some people fall into the mindset that a credit card
| is an extra source of money.
| steveBK123 wrote:
| Exactly.
|
| Putting aside whether the points & benefits value are the
| best in the business anymore (I think they all got a lot
| worse post ZIRP)..
|
| Amex gets the majority of my spend because they are
| cardholder friendly and easy to deal with. I never spend time
| in opaque phone trees, waiting for callbacks, on hold or
| having to argue/escalate any issue.
|
| Their website is good, their phone support is good, and I
| feel protected using the card vs having to deal with some
| random issuer of a branded Visa / big dumb bank / etc.
| jajko wrote:
| Just don't travel to Europe, you will struggle with amex
| here. Almost unknown at any selling point and as per what
| others post for good reasons.
| kmlx wrote:
| not so in the UK, especially London. strong presence.
| they're accepted even at local shops where they dropped
| their fees in order to encourage adoption.
| steveBK123 wrote:
| I keep a backup Visa card and actually 99% of the time
| Amex and some petty cash is still fine in my Western EU
| travels.
| PopAlongKid wrote:
| Ironic, in that American Express (AMEX) traveler's
| cheques used to be (before credit cards were common) a
| nearly universal way for American tourists to carry cash
| when traveling anywhere in Europe, you could always
| exchange them for the local currency, and they would be
| replaced if lost/stolen.
| alephnerd wrote:
| I've travel in Europe a bunch (CEE, Scandinavia, and UK)
| for work and pleasure and Amex has always worked for me.
| I can only think of a handful of times where I had to
| revert to my Visa instead.
| JumpCrisscross wrote:
| > _don 't travel to Europe, you will struggle with amex
| here_
|
| Depends on the country. Worked fine in Portugal, Italy,
| Norway and Britain. Less so in France and Germany--they
| have influential financial centres.
| fignews wrote:
| Live in Germany, use Amex works at 60% of the time. Visa
| 80% of the time. Many businesses are cash only (less
| after Covid)
| maccard wrote:
| In the Uk and Ireland I have a >95% success rate with it.
| I was in Germany recently and had a 0% success rate.
|
| Europe is a big place.
| the__alchemist wrote:
| I've had a 100% successful chargeback rate with Amex, thus
| far.
| dudeinhawaii wrote:
| I like that Amex chargeback is treated like (or is) an
| insurance policy on your card. So, you get successful
| chargebacks 100% of the time and typically within a day.
| They then investigate and try to claw back the refund you
| should have gotten or if they find that you tried to
| double-dip (service refunded and amex refunded) then you'll
| get charged again -- that will only happen if you're trying
| to commit fraud.
|
| Where it shines is times where the merchants give you the
| run around. For instance, I put $500 down on a vehicle in a
| refundable deposit. When it came to cancel it, I was given
| the run around between dealerships and manufacturers, no
| one wanted to pay out. I made the effort (sent an email),
| and then clicked one button on the Amex website for the
| charge and got the money returned in a few hours.
| 0x1ch wrote:
| Anecdotally, Discover took less than 10 minutes from dialtone
| to ending the call to return $1k back to my credit after
| having been hacked and texting "ACCEPT" at 4AM to an insane $
| amount that I assumed was a bill.
| dataflow wrote:
| > 13 digits in a card number
|
| I think you mean 15?
| bediger4000 wrote:
| Pedantic but correct. They just had to be different.
| j-bos wrote:
| As a consumer, Amex treats me well. Both under normal and
| exceptional circumstances, that's rare in consumer business
| relationships.
| darreninthenet wrote:
| As a consumer in the UK, I would wholeheartedly recommend
| Amex... they've always taken my side and even actively argued
| my case against "rogue" retailers and companies whenever I've
| had a problem... their customer service is exceptional compared
| to almost any other company I've had a card with.
| blitzar wrote:
| their customer service is exceptional compared to almost any
| other company of any kind I've dealt with
| switch007 wrote:
| Totally agreed
|
| Even when I cancelled my card (fee based) they did it
| within about 60 seconds, no attempt at retaining me,
| automatically issued a pro rata refund of the fee etc. And
| the chargeback process has always been a breeze
| paxys wrote:
| Amex has the highest fees but also the wealthiest consumers. So
| business have to begrudgingly put up with it.
| quickthrowman wrote:
| > As a consumer who got in trouble during the 2008 depression,
| I will note that Discover is less forgiving, and quicker to
| sell your debt to debt collectors than any other bank.
|
| Discover does lots of subprime lending so that makes sense,
| sell the debt off quickly to get the most pennies per dollar
| for the bad debt.
| thecapybara wrote:
| > Small businesses dislike taking Amex because the per-
| transaction processing fees are bigger.
|
| Even some larger ones. I keep getting emails from Ebay saying
| they're not going to accept Amex soon.
| Havoc wrote:
| That chart about amex winning on deliquencies rings true. UK side
| at least amex seems incredibly fussy about clients. They declined
| applications from two friends - both local equivalent of CPAs
| (and to my knowledge no major financial issues).
| glimshe wrote:
| Their models could be imperfect, but Amex is known for being
| pickier about their customers. This is not different from other
| companies, such as the insurer Amica.
|
| When in doubt, don't take the customer.
| mikepurvis wrote:
| It must be tough being _only_ a credit card and not also a
| person 's bank-- there's just way less info to go on about
| their financial practices.
| inkyoto wrote:
| The main product of AMEX is not a credit card.
|
| It is a charge card which sets them apart from the credit
| card business and brings a higher yield to AMEX, the
| business.
| margalabargala wrote:
| The main product of AMEX is access to its cardholders.
|
| Because they are picky about who receives their card, an
| amex cardholder is likely to spend more than a cardholder
| of another network.
|
| This is why businesses accept amex despite the much
| higher merchant fees; the higher spending by the
| cardholders means that businesses accepting amex tend to
| come out ahead anyway, by virtue of selling more to amex
| cardholders.
| apple4ever wrote:
| Well it's not perfect because they didn't accept me and I
| spend a great deal but always pay my debts.
| Havoc wrote:
| Dunno about others but for me the vast majority of tx do go
| through the card.
|
| But yeah I guess they're blind to stuff like rent and cash
| bal on hand.
| CoastalCoder wrote:
| I didn't realize Amica is especially picky.
|
| But I guess it makes sense. Their customer service and claims
| handling has been outstanding. That's probably easier with a
| more trustworthy (or less risky) clientele.
| anthonypasq wrote:
| my dad has worked there for 35 years, and as far as i know,
| they only used to operate off referrals, it wasnt even open
| to the public
| Havoc wrote:
| Certainly not as picky as some of the fancy cards but yeah
| they def reject uni educated people with stable income
| mise_en_place wrote:
| Not sure if it's ever been made official, but I'm pretty sure
| they look to see if your parents or close family have had an
| existing long term relationship with them. That's how I was
| able to qualify for Platinum, even though my credit score
| wasn't the greatest at the time.
| Havoc wrote:
| They definitely look at corporate cards. I got a personal
| one with literally zero credit history or even 1st world
| financial paper trail. Except for a bottom tier corporate
| card with rather light sporadic use.
|
| That was apparently enough substance
| apple4ever wrote:
| Yup big reason I have a Discover and not AmEx. I do not have
| the best credit, but mostly because I carry balances. Yet I've
| never missed a payment in nearly 25 years (since being in
| college) and that was with Discover. I have the same account
| since then. But AmEx would never accept me.
| tristor wrote:
| I have been an Amex card holder for nearly 30 years. It's one of
| the few brands I have real loyalty to because they've saved my
| bacon so many times while traveling and in other ways.
|
| The conclusions of this analysis match my own personal
| experiences discovering that friends and others I had success
| with in business were also Amex cardholders. Amex cardholders are
| generally more affluent and better at understanding and handling
| their own finances compared to cardholders of other brands. I
| chalk that up mostly to Amex being more selective about who they
| issue cards to.
|
| As an investor that means there's a lower risk (or higher risk
| adjusted return) for every dollar Amex holds on its books
| compared to other card issuing lenders.
| snide wrote:
| Also have a fierce loyalty to AmEx as a customer. I use it as
| often as I can to pay for things. Their customer services is
| phenomenal, and its nice to have an arbiter between you and a
| merchant when things come up. Anytime I've had an issue with a
| merchant, I try to work with them first, and then jump to Amex
| if they aren't willing to work with me. In every instance Amex
| has been able to fix the problem, typically by refusing payment
| to the vendor after an investigation. It's like having
| insurance for your purchases.
|
| I say this as a generic green card member of 25 years. I know a
| lot of people pay for higher tiers for travel benefits, but the
| base service has been excellent for my needs.
| afavour wrote:
| > It's like having insurance for your purchases.
|
| All credit cards provide this, though. Certainly not all will
| have exemplary customer service but I have a Chase card I've
| successfully disrupted transactions through as well.
| radicaldreamer wrote:
| Apple Card's service is terrible, have heard of multiple
| people denied a chargeback for obvious fraud or services
| not provided.
|
| I only use it for specific Apple purchases and Apple Pay
| for consumable goods now.
| rcbdev wrote:
| This doesn't sound like something a rational, financially-savvy
| person would write - instead, it sounds like the opinion of
| someone who is easily manipulated by a few sales-driven
| anecdotes. The comment just sounds like a shabby advertisement.
|
| Also, are most Europeans financially illiterate and poor since
| they aren't AmEx customers and have general disdain for the
| debt-driven economy of credit cards?
| milesskorpen wrote:
| I think your tone is not helpful here. The parent isn't
| attacking you.
|
| Clearly US & ROW card markets are wildly different due to
| various regulations; the structure of the US market and
| related incentives are pretty unusual. A statement about a
| US-based experience doesn't & can't translate toe Europe.
| devilbunny wrote:
| AmEx, at least classically (though less so today) is a
| "charge card", not a "credit card". It's a subtle
| distinction, since they do extend short-term credit, but
| until Pay Over Time became a thing recently, your AmEx bill
| had to be paid in full every month.
|
| As they made no money from balances carried, they have
| traditionally had higher merchant fees and annual fees for
| cardholders. The flip side, for the merchant, is that wealthy
| American cardholders vastly prefer using AmEx, so if those
| are part of your target market, you are much better off
| accepting it.
| dudeinhawaii wrote:
| I don't think they meant anything about Europeans since Amex
| is primarily an American brand. I think the data proves it
| out and it could also have something to do with their history
| as a charge card (i mentioned in another comment).
|
| A charge card means that if you decide to put $10k on the
| card to buy a new big thing, you need to have 10k to pay it
| off at the end of the month.
|
| That would logically self-select for people who have the
| financial ability to pay off a card that has an 'unlimited
| limit'. As the card levels go up, you've also got hefty fees
| ($500+) which again select for people who view $500 as a
| small price compared to the benefits.
|
| I think the OP was rational in their conclusion. Sidenote, it
| also has nothing to do with 'debt fueled economy' -- there's
| no debt accrued with charge cards.
| tristor wrote:
| Wow, being accused of a shill at the same time as the most
| uncharitable take on my comment possible.
|
| I'm in no way associated to AmEx other than being a customer.
| I'm a frequent traveler and formerly digital nomad (78
| countries and counting), and so have had many opportunities
| to see the benefit of my card. I've even mentioned one
| particular instance before on HN:
| https://news.ycombinator.com/item?id=36624867 Since HN skews
| towards people who work in the tech industry, I imagine I am
| not alone in that many of us are likely folks who both travel
| often and have an AmEx.
|
| I didn't say anything about Europeans, and I didn't say
| people who don't have an Amex are financially illiterate or
| poor, I said the folks who Amex has as customers are affluent
| and better at handling their finances (read: better at paying
| off their debts). This is reflected in the data, including
| what is shared in the post. It's not at all a controversial
| statement, and espousing the positive side of that coin does
| not indicate in any way that I believe or hold the views from
| the other side of the coin.
| xp84 wrote:
| They really are selective. In my 20s I once missed a single
| payment to a department store card that I owed $60 to (Not an
| Amex card) and Amex abruptly closed all my accounts in
| response. I'd never been late paying Amex, nor did I have
| anything else negative on my credit.
|
| It took me a decade or so to get over my grudge against
| whatever algorithm triggered that, but I have an Amex card
| again.
| surfingdino wrote:
| Amex has been constantly loosing merchants in the UK. Most recent
| case is eBay no longer accepting it.
| hnbad wrote:
| I'm in Germany and I've never seen any signs anywhere
| indicating Amex is accepted, only Visa, MasterCard and
| Meastro/GiroCard/EC/whatever.
| paxys wrote:
| Those signs are generally outdated. I've had cashiers tell me
| they don't take Amex, and when I tell them to try and run it
| regardless it almost always ends up working. PoS systems have
| evolved a lot in the last decade.
| rjmunro wrote:
| I once had a conversation with a merchant about not taking
| AmEx. He told me they could take it, their machine and
| merchant accounts were all set up, but instead of getting
| paid [whatever they charged] - [small percentage merchant
| fee] relatively quickly, they were sent a bill for AmEx
| fees that was almost impossible to correlate with sales.
| AmEx only paid them for the sales later.
|
| AmEx are 'better' for customers because they screw the
| merchants over.
| AdamN wrote:
| These days most merchants are large or small and just use
| Square or some POS where they don't even know what's
| happening so not sure this is really an issue anymore.
| psunavy03 wrote:
| This has generally always been true for credit cards;
| it's also the genesis of the "we don't take Discover"
| joke above. Better for consumers == merchants have more
| hassles.
| tristor wrote:
| In my experience any time a merchant tells me they don't
| take Amex, they actually do take Amex but the owner /
| manager doesn't like paying the higher merchant fees so
| refuses it since most people carry an alternative payment
| card. I generally insist, and actually if any merchant
| /does/ accept Amex and claims they don't, it's a violation
| of their merchant agreement and you can report them for
| this.
|
| With the exception of international travel, while I'm in
| the US I generally /only/ carry my Amex, because it's as
| good as cash for any of the businesses I'd generally want
| to frequent anyhow.
| vdqtp3 wrote:
| I spent a week in Cologne recently and used my Amex almost
| everywhere I went.
| kazanins wrote:
| On their investor day, Amex said their aspiration is to reach
| 80% merchant coverage in France, Italy, Germany, Sweden and
| Finland by 2026
| flypaca wrote:
| Lot of places take Amex now. I see most POS taking it. There
| are some holdouts who only take Visa, Mastercard but pretty
| much everywhere in my small town take Amex without any
| comments.
| kmlx wrote:
| this has not been my experience at all. i see them supported
| everywhere in london. and even supported in cornwall recently.
| poszlem wrote:
| London's not really "the UK". It's so different from the rest
| of the country, it's like its own little city-state.
| MyFedora wrote:
| Most people in the UK live outside of London (87 % as of
| 2021), so I can't see how that's relevant to anything here.
| alephnerd wrote:
| For a business that targets upper middle class and HNW
| individuals, Greater London, the affluent parts of
| Southwest England, Oxfordshire, Cambridgeshire, and
| Northeast Scotland are all that matters.
|
| Realistically, Amex works in most metros in the UK I've
| travelled in. Maybe the local kebab shop doesn't accept it,
| but the overlap in customer base probably isn't there
| anyhow.
| walthamstow wrote:
| Naive take. If the subject is money, London is always
| relevant.
| surfingdino wrote:
| Small shops, cafes, restaurants, even chains in London refuse
| to take it.
| JumpCrisscross wrote:
| > _Small shops, cafes, restaurants, even chains in London
| refuse to take it_
|
| I've never noticed it, but I'm admittedly speedy when I
| travel. Maybe the high-end spots keep it while lower-end
| ones are walking away? Makes sense with _e.g._ eBay.
| pjc50 wrote:
| Support was never terribly high in the first place. It's the
| least preferable for merchants.
| kazanins wrote:
| On their investor day in May, Amex said international
| acceptance was one of their highest priorities. And they have
| been making impressive progress in target markets.
| autoexecbat wrote:
| The real problem is consumer presumption of lack of amex
| acceptance.
| kazanins wrote:
| True! They mentioned that too. Technical acceptance level
| is not the same as consumer or even merchant awareness.
| Bluecobra wrote:
| > Moreover, Discover cards come with no annual fees, while
| American Express keeps increasing its card fees with every card
| "refresh".
|
| Not all Amex cards have fees.
|
| Also it would have been nice if the author went a little into the
| history like how Discover was once part of Sears. Not sure if
| this is still the case or not, but the classic Green, Gold, and
| Platinum cards are charge cards and have to be paid in full each
| month. Some of these things may explain why Amex is more
| affluent.
| makestuff wrote:
| > Not sure if this is still the case or not, but the classic
| Green, Gold, and Platinum cards are charge cards and have to be
| paid in full each month.
|
| They changed this a few years ago with the "pay over time"
| feature on those cards.
| jjice wrote:
| To add to this as well, this can be disabled, but it's on by
| default for new applicants. They can put a limit on the
| charge cards as well, so it can be almost an ambiguously
| limited credit card now. That said, I don't think being given
| a set limit is very common, or very impactful for the average
| person unless you're a large spender.
| Dalewyn wrote:
| Not all charges can be PoT'd, though. In general you still
| have to pay the entire statement balance each billing cycle
| (it's a good habit to have when using credit cards anyway).
| blitzar wrote:
| My one changed from charge card to interest bearing - it is
| now 704.6% interest rate, so it is still a charge card!
| quickthrowman wrote:
| What country is that in?
| blitzar wrote:
| UK
| farceSpherule wrote:
| Pay over Time is only for "eligible" charges, not the entire
| balance.
| bigstrat2003 wrote:
| I have yet to see a charge on my Amex Platinum that _wasn
| 't_ eligible for pay over time. In practice, I would say
| it's not different from another credit card at this point.
| kopecs wrote:
| I believe each transaction has to be over $100 and
| there's a total limit on the number of pay over time
| plans you can have active. But yes, other than the dollar
| amount, I've not seen anything not be eligible.
| alberth wrote:
| Discover also doesn't come with all the "perks" that Amex does.
|
| Airport lounges, concierge, exclusive books on Michelin star
| restaurants (also via Tock acquisition), etc.
| BenjiWiebe wrote:
| My Discover card has actually benefitted me more than my
| (entry -level) AMEX. Discover has 5% cashback categories
| every quarter, and most of them are for common charges. I've
| had the bonus on "gas" two or three times already. Also
| Amazon, grocery stores, paypal.
| darth_avocado wrote:
| The Discover cash back perks went down quite a bit, at
| least from my perspective. The categories I used to use
| come on way less frequently now.
| denimnerd42 wrote:
| yup just easier to use my bofa card which is 2.625% on
| everything (due to platinum honors preferred rewards
| which is "easy" to obtain with some >100k in a brokerage
| account - could be equities, CDs, money market..
| whatever)
| Spivak wrote:
| Also your 401k and IRA count.
| Spivak wrote:
| And they hard-capped the 5% categories so it's really
| just 1% plus a little.
| tryptophan wrote:
| I find the mental overhead of tracking categories to be
| extremely irritating and I have just stopped using the
| discover card.
| listenallyall wrote:
| Ironically, you're demonstrating why Amex has higher status
| or "perceived value." The stereotypical Discover cardholder
| is extra frugal, micromanaging small cashback percentages
| (and bragging about it), something the stereotypical Amex
| cardholder doesn't have time for. It's kind of the same way
| a cheap Holiday Inn will make a big deal about offering
| free breakfast while the Four Seasons, costing 10x as much,
| does not. Now, stereotypes may not be reality, but that's
| what 60 years of very effective marketing can do.
| kazanins wrote:
| Yeah, I read that Discover was created by Sears. It was also
| part of Morgan Stanley for a short period of time!
| jvanderbot wrote:
| I had a discover card for a long time. It had amazing cash-back
| benefits, low interest rate, and no annual fee.
|
| Bad for business, but really great card!
|
| We went to Amex exclusively for the flight rewards with Delta,
| even copping the annual fee b/c it paid back in travel rewards
| (we travel often for work / fun).
| ryandrake wrote:
| I've had the Blue Delta Amex card for 20 years as my "daily
| driver" but recently concluded that the miles benefit was just
| not sufficient vs. a different card that gave cash back. It
| takes years and years of purchases to build up enough miles to
| redeem for even a single domestic trip. Ultimately not worth it
| unless you're augmenting it with regular paid-travel and/or use
| a card with a yearly fee.
|
| I will keep it around for "risky" transactions though, where I
| believe I may have to issue a chargeback, since Amex is very
| customer-friendly when it comes to chargebacks.
| AaronM wrote:
| IMO, Discover's web and mobile application is better than AMEX.
| paxys wrote:
| The TL;DR is that AmEx targets ultra high spenders and
| corporations, while Discover is generally considered low end (and
| has the highest delinquency rates to show for it).
| bell-cot wrote:
| For those unfamiliar - _historically_ *, American Express was the
| card of the well-connected and well-to-do. And at least
| statistically, that's still the case. So between how well AmEx
| treats it's "members", and their awareness of the social status -
| AmEx's business model has a pretty good moat.
|
| *Meaning back to the late 1950's. Things get very different if
| you look at the century before that.
| Dalewyn wrote:
| While I have a Visa just in case (AMEX isn't accepted
| everywhere), I nonetheless have disdain for Visa and Mastercard
| (I don't have the latter).
|
| AMEX doesn't care what I'm spending on so long as it's legal
| (obviously) and it's actually me doing the spending.
| Visa/Mastercard care far too much about how I spend money, which
| is frankly none of their business so long as I properly pay the
| bills (which I do).
|
| AMEX is in the business of moving money between customer and
| merchant and performs their job exceptionally, so I'll always use
| them over Visa/Mastercard when possible.
| rconti wrote:
| I had weird issues in South America where (say) Visa was
| accepted, but MasterCard wasn't. As a(n) (North-)American, i've
| always considered the 2 as precisely equal because the
| processors that handle one always seem to handle the other. The
| only question is only ever whether Amex or Discover is
| accepted.
| nottorp wrote:
| You mean pornhub can still take Amex? I thought Visa and MC
| banned it.
| Dalewyn wrote:
| No clue about Pornhub, but as someone who frequently shops at
| Japanese online stores I know places like DMM stopped taking
| Visa/Mastercard (because of their nanny bullshittery) while
| they still take AMEX like they always did.
|
| That whole fiasco vindicated my loyalty to AMEX: So long as
| the transaction is legal and authorized and ultimately paid
| for, they really do not care how an AMEX cardholder spends
| because it's none of their business.
| tiffanyh wrote:
| Jerry Seinfeld / American Express ad:
|
| https://www.youtube.com/watch?v=ufDslAOkZ50
| eloisant wrote:
| I don't understand that ad, why would anyone care about doing
| exactly 20?
| tiffanyh wrote:
| Using credit cards was not the norm in the 80s/90s, using
| cash was.
|
| And no one wanted to get the dreaded 99 pennies back if you
| could avoid it.
|
| Using credit cards meant you didn't have to worry about
| pennies anymore.
| xyst wrote:
| because of change.
|
| US currency offered in 1, 5, 10, 20, 50, 100 denominations.
| $20 bill being the most common bill that people carried.
| saghm wrote:
| When I was a kid, I remember my parents used to try to pay for
| everything with their Discover card and would only use their Visa
| as a fallback. I was too young to understand the differences
| between credit cards at the time, but I remembered my parents
| always asking "do you take Discover?" everywhere we went. I never
| realized this wasn't just something only my parents did until I
| saw the Futurama joke about this years later:
| https://www.youtube.com/watch?v=2-nSwKOVZyk
|
| Fry: Do you take Visa? Cashier: Visa hasn't existed for 500 years
| Fry: American Express? Cashier: 600 years Fry: Discover? Cashier:
| Sorry, we don't take Discover
| HaZeust wrote:
| Great gag, and I'm still in my depths of that practice.
| Luckily, about 80%+ of the places I ask take Discover.
| robertlagrant wrote:
| I clicked on the comment section ready to make this same
| reference. Such a good joke.
| dudeinhawaii wrote:
| I wonder if the AMEX cards historically being "charge cards",
| which have to be paid in-full at the end of the month, encouraged
| healthy habits and better credit scores.
|
| I credit my first AMEX with helping to keep my spending in-check
| when I started high-paying jobs because I always had in the back
| of my mind that the balance had to be paid-in-full. Take a lavish
| vacation? Make sure you have the savings to pay it off. In the
| end it was always paid off monthly.
| JoshGlazebrook wrote:
| The charge cards don't even have to be paid in full anymore.
| They offer "pay over time" for charges on
| platinum/gold/green/etc which effectively makes them credit
| cards.
| HaZeust wrote:
| The productivity in my life for my AMEX Platinum card is directly
| inversely proportional with how much traveling I do. If I'm
| having an off-year for traveling, it's pretty much nothing more
| than weight in my pocket.
|
| Discover IT was used to start my credit-building journey a year
| ago, and helped me reach a 740 credit score in 12 months after
| having 3 total credit accounts (Discover IT, Apple Card, Amex
| Plat) and 1 installment account (car loan).
|
| My bias between the two is clear.
| farceSpherule wrote:
| American Express sucks when you leave the United States,
| especially in Europe.
| mhalle wrote:
| When I had my wallet stolen in London about a decade ago, Amex
| was far faster, easier, and friendlier replacing my credit card
| than was Citibank. Did it at an in-person Amex office.
| guidedlight wrote:
| As an Australian, I've never seen Discover cards.
|
| American Express has been largely replaced in Australia by Visa
| signature and Mastercard platinum cards that are more difficult
| for merchants to deny.
| xyst wrote:
| > in 2023, Amex cardholders (U.S. consumers only) spent, on
| average, $13,945 per year, or almost 4 times more than Discover
| cardholders
|
| Honestly, not surprised. AXP/AMEX marketing team and superior
| customer service in the early days of the programs made it the
| top card to own amongst wealthy individuals.
|
| The once coveted "black card" or Centurion product was invite
| only to existing card holders with the platinum card and met a
| certain annual spend criteria (some 6 figure amount). Card
| holders of this product paid some couple thousand dollar
| "initiation fee" and of course the annual fee. AXP got paid and
| then double dipped on the merchant side with even higher fees
| (the "no limit" cards charge a higher transaction fee).
|
| Its exclusivity and hype has died down, especially when it
| started to issue centurion for businesses. Very easy to hit the
| required spend limit and use it as a weird flex at your next
| dinner party or restaurant outing with friends/family.
|
| Honestly, if it wasn't for the centurion product. AXP would just
| be another credit card company and credit card network out in the
| wild (maybe it would have just been like "Diner's Club")
| chasd00 wrote:
| >The once coveted "black card" or Centurion product
|
| it even made it into pop culture, Ariana Grande's song 7 Rings
| has the lines
|
| Black card is my business card The way it be settin' the tone
| for me I don't mean to brag, but I be like, "Put it in the
| bag,"
| yieldcrv wrote:
| there have been r&b songs about this card since late aughts
| to my knowledge, when it was still mythical
|
| but yeah the US Amex platinum has most or better perks than
| the Centurion now
| CobrastanJorji wrote:
| One thing not discussed is the relationship between AmEx's big
| purchases and its fees. American Express puts a lot of effort
| into keeping its paying consumers happy because they are both
| American Express customers (because they pay fees) and because
| customers really want to use American Express cards at merchants
| (and so American Express can charge those merchants higher fees).
|
| I'll give you an example. Years ago, I bought a fancy sofa
| online. The merchant sent periodic "don't worry, we're just
| behind schedule" every week or so for months, and then sent one
| last email saying they had declared bankruptcy. I was way out of
| my chargeback window, but when I called American Express, they
| instantly refunded me my purchase anyway. That experience meant
| that, if I ever make another big purchase online, I will go out
| of my way to use an American Express card, including switching
| merchants if necessary.
|
| Keeping customers who make big purchases happy costs money, both
| in losses and in administrative overhead, but it pays out on both
| the customer and merchant side in the long run.
| Rapzid wrote:
| I'm about done with Amex. They overcorrected on lounge
| overcrowding and now I can't get my wife in free for my ever
| increasing yearly membership fee?
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